GSA's $111.9M Pharmaceutical Managed Services contract awarded to Metro Logics Inc. shows a decade-long duration

Contract Overview

Contract Amount: $111,927,430 ($111.9M)

Contractor: Metro Logics Inc

Awarding Agency: General Services Administration

Start Date: 2010-06-04

End Date: 2020-06-03

Contract Duration: 3,652 days

Daily Burn Rate: $30.6K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: PHARMACEUTICAL MANAGED SERVICES

Place of Performance

Location: SALT LAKE CITY, SALT LAKE County, UTAH, 84104

State: Utah Government Spending

Plain-Language Summary

General Services Administration obligated $111.9 million to METRO LOGICS INC for work described as: PHARMACEUTICAL MANAGED SERVICES Key points: 1. The contract's significant value over a 10-year period suggests a substantial need for pharmaceutical managed services. 2. Full and open competition was utilized, indicating a broad market solicitation for these services. 3. The definitive contract type with a firm fixed price suggests predictable cost structures. 4. The contract spans a decade, allowing for long-term planning and potential for sustained service delivery. 5. The award to a single contractor, Metro Logics Inc., warrants examination of performance and market dynamics. 6. The absence of small business set-aside flags potential for larger prime contractors to dominate.

Value Assessment

Rating: fair

Benchmarking the value of this $111.9 million contract over 10 years requires detailed analysis of the specific pharmaceutical managed services provided. Without comparable contract data or a breakdown of services rendered, it is difficult to definitively assess value for money. However, the firm fixed-price structure suggests an attempt to control costs, but the long duration could lead to price escalations if market conditions change significantly. The absence of specific performance metrics makes a direct comparison challenging.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under 'Full and Open Competition After Exclusion of Sources,' which implies that while the competition was broad, certain sources were initially excluded before the final solicitation. The presence of 3 bidders indicates a moderate level of competition. This suggests that the agency sought competitive proposals but may have had specific requirements that narrowed the initial pool. The competition level is adequate for price discovery but could potentially be improved with broader outreach.

Taxpayer Impact: The use of full and open competition generally benefits taxpayers by encouraging multiple vendors to offer competitive pricing, potentially leading to cost savings. However, the exclusion of certain sources might have limited the full extent of potential savings.

Public Impact

Beneficiaries include federal agencies requiring pharmaceutical managed services, potentially improving efficiency and cost-effectiveness in drug procurement and management. Services delivered likely encompass a range of pharmaceutical supply chain management, formulary management, and potentially clinical support. The geographic impact is likely nationwide, given the General Services Administration's role in managing federal procurement. Workforce implications could involve specialized roles within Metro Logics Inc. and potentially within federal agencies managing the contract.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Long contract duration (10 years) may lead to vendor complacency or reduced incentive to innovate over time.
The 'after exclusion of sources' clause in the competition type warrants further investigation into the rationale for exclusions.
Lack of specific performance metrics in the provided data makes it difficult to assess contractor performance objectively.
The absence of small business set-aside could limit opportunities for smaller, specialized firms in the pharmaceutical services sector.

Positive Signals

Firm fixed-price contract type provides cost certainty for the government.
Full and open competition, even with exclusions, suggests an effort to achieve competitive pricing.
The contract's long duration indicates a stable, ongoing requirement for these services, suggesting a successful initial award.
Awarded by the General Services Administration, a central procurement agency, implying adherence to established procurement standards.

Sector Analysis

The pharmaceutical managed services sector is a critical component of healthcare and government operations, involving the procurement, distribution, and management of medications. This contract fits within the broader federal IT and professional services landscape, as managing pharmaceutical services often involves complex data systems and logistical coordination. Comparable spending benchmarks would typically be found within GSA's Federal Acquisition Service (FAS) portfolio for similar large-scale service contracts, though specific pharmaceutical managed services contracts are niche.

Small Business Impact

The data indicates that this contract was not set aside for small businesses (ss: false, sb: false). This suggests that the scope and nature of the pharmaceutical managed services required were likely beyond the typical capacity or specialization of small businesses, or that the competition strategy favored larger, established providers. Consequently, opportunities for small businesses to participate as prime contractors were limited. However, there may be subcontracting opportunities for small businesses if Metro Logics Inc. chooses to engage them, though this is not explicitly detailed in the provided data.

Oversight & Accountability

Oversight for this contract would primarily fall under the General Services Administration (GSA), specifically the Federal Acquisition Service (FAS). GSA has established procurement regulations and contract management processes to ensure accountability and transparency. The definitive contract type and firm fixed-price nature provide a degree of financial oversight. However, the effectiveness of oversight depends on the specific contract clauses, performance monitoring, and reporting requirements, which are not detailed here. Inspector General jurisdiction would apply if any fraud, waste, or abuse were suspected.

Related Government Programs

Pharmaceutical Procurement
Healthcare Services Contracts
Federal Supply Schedule (FSS) Contracts
Logistics and Supply Chain Management Services
Managed Services Contracts

Risk Flags

Long contract duration may reduce flexibility.
Competition level could potentially be higher.
Specific services and performance metrics not detailed.
Rationale for source exclusion requires clarification.

Frequently Asked Questions

What is this federal contract paying for?

General Services Administration awarded $111.9 million to METRO LOGICS INC. PHARMACEUTICAL MANAGED SERVICES

Who is the contractor on this award?

The obligated recipient is METRO LOGICS INC.

Which agency awarded this contract?

Awarding agency: General Services Administration (Federal Acquisition Service).

What is the total obligated amount?

The obligated amount is $111.9 million.

What is the period of performance?

Start: 2010-06-04. End: 2020-06-03.

What specific pharmaceutical managed services are included under this contract?

The provided data does not specify the exact services covered under 'Pharmaceutical Managed Services.' Typically, such contracts can encompass a wide range of activities including, but not limited to, drug formulary management, procurement and sourcing of pharmaceuticals, inventory management, distribution logistics, clinical pharmacy services, patient assistance programs, and data analytics related to drug utilization and cost. The General Services Administration (GSA) would have detailed statements of work (SOW) outlining these specific services for Metro Logics Inc. Understanding the precise scope is crucial for evaluating the contract's value and performance.

How does the $111.9 million total award value compare to similar pharmaceutical managed services contracts within the federal government?

Direct comparison of the $111.9 million total award value over 10 years to similar federal pharmaceutical managed services contracts is challenging without access to a comprehensive database of such awards. However, GSA manages numerous large-scale service contracts, and this value appears substantial, reflecting a significant requirement. The value per year averages approximately $11.19 million. To benchmark effectively, one would need to identify contracts with similar service scopes (e.g., comprehensive pharmacy benefit management, large-scale distribution) awarded by agencies like the Department of Veterans Affairs (VA) or the Department of Defense (DoD) over comparable timeframes and assess their total values and annual expenditures.

What are the key performance indicators (KPIs) used to evaluate Metro Logics Inc.'s performance under this contract?

The provided data does not include specific Key Performance Indicators (KPIs) for this contract. In a typical federal contract of this nature and duration, KPIs would be defined in the Performance Work Statement (PWS) or Statement of Work (SOW). These might include metrics related to drug availability rates, delivery timeliness, cost savings achieved through formulary management or negotiation, inventory accuracy, compliance with regulations (e.g., Drug Enforcement Administration), and customer satisfaction surveys from the benefiting federal agencies. Regular performance reviews would assess Metro Logics Inc.'s adherence to these KPIs.

What is the rationale behind the 'after exclusion of sources' clause in the contract's competition type?

The 'Full and Open Competition After Exclusion of Sources' clause indicates that while the competition was intended to be broad, certain potential sources were excluded from the initial solicitation phase. The rationale for such exclusions typically stems from specific technical requirements, security clearances, past performance issues with certain vendors, or unique capabilities that only a limited number of firms possess. Without further documentation from the GSA solicitation or award justification, the precise reasons for excluding specific sources remain unknown. This clause warrants scrutiny to ensure it was used appropriately and did not unduly restrict competition.

What is the historical spending pattern for pharmaceutical managed services by the GSA or related agencies?

The provided data only details this single contract awarded in 2010 with an end date in 2020. To understand historical spending patterns, one would need to analyze GSA's procurement data over multiple years, looking for similar contracts or categories of pharmaceutical services. This would involve examining spending trends, the number and value of contracts awarded in this space, and the primary contractors involved. Such an analysis would reveal whether this $111.9 million contract represents a consistent level of investment or a significant deviation from prior or subsequent spending in pharmaceutical managed services.

What are the potential risks associated with a 10-year definitive contract for pharmaceutical managed services?

A 10-year definitive contract for pharmaceutical managed services carries several potential risks. Firstly, the long duration may lead to vendor lock-in, making it difficult and costly to switch providers if performance declines or market conditions change. Secondly, technology and pharmaceutical landscapes evolve rapidly; a 10-year contract might not adequately accommodate advancements or shifts in best practices, potentially leading to suboptimal service delivery or outdated processes. Thirdly, the firm fixed-price structure, while offering cost certainty initially, could become disadvantageous if input costs (e.g., drug prices, labor) rise significantly beyond projections, potentially impacting the contractor's willingness or ability to maintain service quality. Finally, sustained performance over a decade requires robust oversight to prevent complacency.

Industry Classification

NAICS: Transportation and Warehousing › Warehousing and Storage › Refrigerated Warehousing and Storage

Product/Service Code: RESEARCH AND DEVELOPMENT › DEFENSE (OTHER) R&D

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Parent Company: Esmark Corp. (UEI: 034802249)

Address: 10635 MARINA DR, OLIVE BRANCH, MS, 38654

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Small Business, Special Designations, U.S.-Owned Business, Woman Owned Business

Financial Breakdown

Contract Ceiling: $139,962,368

Exercised Options: $126,313,411

Current Obligation: $111,927,430

Contract Characteristics

Multi-Year Contract: Yes

Commercial Item: SUPPLIES OR SERVICES PURSUANT TO FAR 12.102(F)

Cost or Pricing Data: NO

Timeline